Shi Company is going through a Chapter 7 bankruptcy. All assets have been liquidated, and the company retains only $26,200 in freecash. The following debts, totaling $43,050, remain:$ 7,000Government claims to unpaid taxesSalary during last month owed to Mr. Key (not anofficer)Administrative expenses19,2003,450Salary during last month owed to Ms. Rankin (notan officer)Unsecured accounts payable5,8507,550Indicate how much money will be paid to the creditor associated with each debt.Types of DebtsAmountsAdministrative expensesGovernment claims to unpaid taxesSalary during last month owed to Mr. Key and Ms. Rankin

Given: Free cash retained - $26,200 Unpaid taxes claimed by the government - $7,000 Owed Salary to…

Answered: Shi Company is going through a Chapter…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Shi Company is going through a Chapter 7 bankruptcy. All assets have been liquidated, and the company retains only $26,000 in free cash. The following debts, totaling $42,050, remain: Government claims to unpaid taxes Salary during last month owed to Mr. Key (not an officer) Administrative expenses Salary during last month owed to Ms. Rankin (not an officer) Unsecured accounts payable Required: Indicate how much money will be paid to the creditor associated with each debt. Types of Debts Administrative expenses Amounts $ 3,250 Salary during last month owed to Mr. Key and Ms. Rankin Government claims to unpaid taxes 0 $ 6,800 18,625 3,250 5,890 7,350
Payable to Company Founder Jensen Inc. has a $500,000 note payable due to its founder, Jen Jensen. Ms. Jensenis recently deceased and has no heirs that Jensen Inc.’s executive team is aware of. The company has asked for yourhelp to determine whether it is appropriate to derecognize the liability from its financial statements.Required:1. Respond to Jensen Inc. Describe the applicable guidance requirements, including excerpts as needed to supportyour response.2. Next, explain how you located the relevant guidance, including the search method used and which section yousearched within the appropriate topic
None
Goose Corporation, a C corporation, incurs a net capital loss of $23,900 for 2021. It also has ordinary income of $19,120 in 2021. Goose had net capital gains of $4,780 in 2017 and $9,560 in 2020. If an amount is zero, enter "0". a. Determine the amount, if any, of the net capital loss of $23,900 that is deductible in 2021.$fill in the blank 1 _______ ? b. Determine the amount, if any, of the net capital loss of $23,900 that is carried forward to 2022.$fill in the blank 1 ______?
A
55)Grounds for Divorce Coffee Corporation had sales of $3 million this past year. Its cost ofgoods sold was $1.1 million and its operating expenses were $400,000. Interest expenseson outstanding debts were $160,000, and the company paid $40,000 in preferred stockdividends. The company received interest income of $14,000. Determine Grounds’taxable income.
Charlotte, Inc. began business on January 1, 2021. Its pretax financial income for the first two years was as follows: 2021 $550,000 2022 590,000 The following items caused the only differences between pretax financial income and taxable income. In 2021, the company terminated a top executive and agreed to 120,000 of severance pay. The amount will be paid $40,000 per year for 2021 - 2023. The 2021 and 2022 payments were made. For financial statement purposes, the $120,000 was expensed in 2021. For tax purposes, the severance pay is deductible as it is paid. In 2021, the company reported depreciation expense in its financial statements of $82,000. Depreciation expense for tax purposes was 134,500. The difference will reverse evenly over the next three years (2022-2024) The tax rate in 2021 is 20% and no tax rate changes have been enacted that affect the years 2022 – 2024. Required: Determine taxable income for 2021…
lota Corporation has suffered losses for several years, and its debts total $495,000; lota's assets are valued at only $410,000. lota's creditors agree to reduce lota's debts by one-half in order to permit the corporation to continue to operate. lota's NOL carryover is $165,000. Requirements a. What impact does the reduction in debt have on lota's NOL? b. Is lota required to report any income? Requirement a. What impact does the reduction in debt have on lota's NOL? The total debt reduction is The debt reduction due to insolvency is The NOL carryover The NOL carryover after the debt reduction will be Requirement b. Is lota required to report any income? Old will report income of This is because
6
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